The present invention is directed to a credit card, bank card, charge card, or other payment product, and more particularly, to a system and method for enhancing the value and desirability of such a card to both the card holder and to the bank, financial institution or other issuer of the card through a rewards platform and program which provide the card holder with a benefit based on not only a qualifying purchase, but on miles traveled using a travel ticket, travel pass or the like purchased with the card.
Credit cards or charge cards allow card holders to pay for services and/or merchandise without using cash at the time of purchase. Credit cards are generally issued by a bank or other financial institution and provide a mechanism by which a card holder can receive a temporary loan from the bank for the purpose of paying for the purchase. The card holder may thereafter either pay the outstanding balance or, as a matter of choice, defer the balance for later payment with accompanying interest or finance charges for the period during which payment of the debt is deferred.
Credit cards are ubiquitous in today's society. Many consumers have more than one credit card and regularly use different credit cards to make their various purchases. Banks and financial institutions issue credit cards and service credit card accounts. The issuer may also generate revenue through a per transaction fee or commission charged to retailers and other merchants when the retailer processes a credit card holder's purchase, and from finance charges accrued when the credit card holder incurs a revolving balance on that issuer's credit card.
A credit card issuer would prefer that card holders predominantly use that issuer's credit card in order to generate the largest amount of fees and revenue. Therefore, the credit card issuer may offer incentives to card holders who use that issuer's card. Often the incentives are accumulated when the card holder uses the credit card. This benefits the card issuer because, with credit card usage, comes the opportunity for the card issuer to generate fees and revenue.
Banks and other financial institutions can also offer credit cards that provide the credit card holder with a particular benefit every time a purchase of goods or services using that card is made as an incentive for the credit card holder to use their credit card. For example, the benefit may be a certain amount of frequent flyer miles, or a discount voucher good toward the purchase of a gift or other merchandise. These benefits are vigorously promoted by the banks or card issuing organizations.
Increasingly, credit cards are being issued by banks and financial institutions in association with other commercial companies or businesses which themselves offer goods and/or services. This phenomenon, known as co-branding, provides a credit card that often carries the name of the commercial company along with the issuer's name. The commercial company often provides the credit card holder certain benefits which are typically related to the goods or services provided by that commercial company. An example of a co-branded credit card is the General Motors card (MASTERCARD or VISA) which offers credit card holders 5% earnings on card purchases toward the purchase or lease of a new General Motors vehicle.
With all the various benefit and incentive programs available from credit card issuers, consumers may have difficulty choosing between the different credit cards that they hold when deciding to make a purchase. For example, should the credit card holder choose to use a card that provides frequent flyer miles, or a card that provides some other benefit? Also, since benefit and incentive programs sponsored by a particular commercial company require that the credit card holder redeem benefits from that sponsoring company or its commercial partners, consumer choice is limited. For example, if the credit card holder is accumulating frequent flyer miles with one airline, the card holder is constrained to use that airline or its frequent flyer program partners when planning a trip if the card holder is to take advantage of the benefit. Because of the limits on redemption, the appeal of the card may be less than universal.
An opportunity therefore exists for a new credit card rewards platform and program which offer valuable benefits to card holders automatically based on not only qualifying purchases using the card, including, for example, purchases of travel tickets, travel passes or the like, but on miles traveled using tickets or passes purchased with the card, while providing flexibility to the card holders in the choice of rewards benefits.